MUMBAI: On 1 February, the finance minister Arun Jaitley made significant announcements during the presentation of the Union Budget 2017. Although, there was no specific mention of measures for the media and entertainment industry, certain steps which have been taken to boost the economy have been appreciated by the industry, but it also disappointed some.
The budget 2017 mainly focused on boosting the infrastructure and lifting rural income besides bringing in reforms in the financial sector such as the abolition of the Foreign Investment Promotion Board (FIPB) so as to facilitate a new policy for foreign direct investment (FDI). The budget also focused on digitisation — allocating Rs 10, 000 crore to boost the rural fibre optics network, which came as a great news for many in the media and broadcast industry.
Indiantelevision.com reached out to several industry stalwarts to find out how they interpreted the Union Budget 2017. Here’s what they had to say:
Viacom18 group CEO and CII Media and Entertainment Committee chairman Sudhanshu Vats said, “Much had been speculated about the economic slowdown post demonetisation. With this budget, the government has taken important steps to boost the economy in a structured manner, building on the promise of transparent growth. Steps to liberalise the FDI regime further coupled with the abolishing of FIPB and tax reforms for MSMEs are bound to have impact in the foreseeable future. This budget has seen some positive solutions to tackle poverty in our country including one of the highest allocation of funds to MNREGA and rationalisation of rate for the lower personal tax slabs. I am particularly enthused by the strong reforms push for digitization and look forward to digital transactions increasing in the country. This also augurs well for digital consumption of video content. The move to cap political donations in cash at Rs 2000 and all-cash transactions at Rs 300,000 are also much-needed, bold steps that are in line with the government’s commitment to uprooting corruption. With Swaach Bharat being close to our hearts, the budget has built further on this theme in a welcome move. I’ve said this before and will say it again: as the M&E sector we have a lot to gain from buoyance in the economy at the aggregate level and I believe this Budget has delivered on that front.”
Zee Entertainment Enterprises Limited (ZEEL) MD and CEO Punit Goenka stated, “Budget 2017 speaks a lot about the government’s positive and committed approach towards creating a stronger and balanced economy. Being directionally right and focused on spending in growth-centric areas, it clearly reassures the fact that remonetisation is in.”
Times Network MD and CEO M K Anand said, “After the recent massive policy implementation of demonetisation, my expectation was of some radical reforms. I was a bit disappointed on that count. However, enhanced provision for MNREGA and allocations for rural, agriculture and allied sector and a clear push for the affordable housing sectors is the silver lining. Agriculture and real estate are the most important employment generating sectors in India. This should improve the rural situation which is still recovering from demonetisation. Hopefully, that will have a ripple effect on spending and the larger economy.”
Says ABP COO Avinash Pandey, “The Union Budget 2017 was disappointing as far as the expected incentive for the broadcast business is concerned. Service tax remains the same. Most importantly, there is no parity with the print sector. The ‘wow’ factor was missing (in the budget) as far as the business is concerned. Disposable income is going to increase, and hence the quantum of spending. Economy may revive after the implementation of the budget.”
Network 18 president revenue and Forbes India CEO Joy Chakraborthy is hopeful, saying, “We are seeing it as a positive budget. The budget is going to help consumption. Significant measures to improve electrification is eventually going to help the television industry. The general sentiment is that it is, overall a positive budget. Once people start spending money, consumption will be there and subsequently advertising too will follow.”
Says, BBC Worldwide – BBC Worldwide India South East Asia and South Asia SVP and GM Myleeta Aga, “Overall a positive popular budget with personal income tax changes in line with the government’s declared intention to collect more taxes from the rich and reduce the tax burden on the middle income group.”
She added, “I was particularly encouraged to hear that the GST roll out will not be delayed. Operationally, for the production business, this will complicate working across states but this disruption should be temporary. Continued emphasis on the digital economy and increasing digital transactions will boost growth of e-commerce.”
SAB group CEO Manav Dhanda said, “Overall, there has been positives for the media and entertainment sector post the Union Budget. As digitization is the next big thing now, the end of March 2018 will see a great growth for digital video consumption across OTT. The youth can now have great opportunities laid for them by initiating the skill India mission that aims to start 100 India International centres. Also, since digitization is on a high, setting up high speed internet in 1.50 Lakh Gram Panchayat is a good move and will give a boost to internet penetration in India. There is no increase service tax by the government and is a positive outcome particularly for the M&E sector, a stable and positive fiscal situation is good for the economy which will also give an impetus to our advertising sales projections. Increased public spending through various schemes and focus on infrastructure investments should further help to accelerate economic growth. The economy seems to have being slowing down since demonetisation, impacting almost all sectors and one hopes this budget to act as a catalyst to propel the growth in the media sector as well.”
KPMG India partner tax Naveen Aggarwal said, “The Budget was based on broad themes of curbing black money, boosting individual spending, ensuring transparency and providing much needed impetus to agricultural and rural sector, infrastructure and digital economy.”
He added, “While the announcement to abolish FIPB in light of successful e-governance was surprising, further liberalisation in FDI policy will be keenly watched in context of M&E industry. Lastly, the FM provided much needed assurance on roll-out of GST as per schedule, confirming GST council finalising majority of its recommendations.”
He further added, “Similar to last two years, the Budget did not bring much respite or specific announcements benefiting M&E industry. While the expectation of overall reduction in corporate tax rate and abolition of MAT was given a miss, the proposal to reduce corporate tax rate for MSMEs to 25% (having turnover up to Rs 50 crore) and increasing the MAT credit entitlement (from 10 to 15 years) is a welcome move and will benefit medium scale service companies in M&E sector.”
